The Cost Reduction Incentive Program at the Savannah River Site. Audit report

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The Department of Energy (Department) established a Cost-Reduction Incentive Program (CRIP) at Westinghouse Savannah River Company (Westinghouse) in October 1992. In 1997, the Department performed a comprehensive review of Westinghouse`s performance-based incentives and cost-reduction incentives, and concluded that most of the savings identified through the CRIP occurred through greater management focus on reducing costs, working smart, or the results of budget constraints, as opposed to innovative changes in work methods and processes. The Assessment Team recommended that the Savannah River Operations Office (Operations Office) re-evaluate the effectiveness of the CRIP and consider either modifying the program to provide for payment ... continued below

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15 p.

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Creator: Unknown. May 1, 1998.

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Description

The Department of Energy (Department) established a Cost-Reduction Incentive Program (CRIP) at Westinghouse Savannah River Company (Westinghouse) in October 1992. In 1997, the Department performed a comprehensive review of Westinghouse`s performance-based incentives and cost-reduction incentives, and concluded that most of the savings identified through the CRIP occurred through greater management focus on reducing costs, working smart, or the results of budget constraints, as opposed to innovative changes in work methods and processes. The Assessment Team recommended that the Savannah River Operations Office (Operations Office) re-evaluate the effectiveness of the CRIP and consider either modifying the program to provide for payment only for innovative ideas, or cancel the program and utilize performance-based incentives to reward cost savings over some pre-established threshold. The objective of this audit was to determine whether the Operations Office took appropriate action in response to the Department`s internal assessment of the CRIP. The Operations Office did not take appropriate action in response to the internal assessment. The Operations Office stated that Westinghouse did not agree to the modification or cancellation of the CRIP, and the Department could not unilaterally modify or cancel the program because it was incorporated into the contract. However, the Operations Office could have substantially reduced its CRIP payments to Westinghouse without amending the contract by (1) enforcing the contract terms that required Westinghouse to use best commercial practices and industry standards in contract performance, and (2) requiring Westinghouse to comply with its internal procedures which required that cost-reduction proposals be innovative.

Physical Description

15 p.

Notes

OSTI as TI98003593

Medium: P; Size: 15 p.

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  • Other Information: PBD: May 1998

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  • Other: TI98003593
  • Report No.: ER-B--98-08
  • DOI: 10.2172/621855 | External Link
  • Office of Scientific & Technical Information Report Number: 621855
  • Archival Resource Key: ark:/67531/metadc698554

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Office of Scientific & Technical Information Technical Reports

Reports, articles and other documents harvested from the Office of Scientific and Technical Information.

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  • May 1, 1998

Added to The UNT Digital Library

  • Aug. 14, 2015, 8:43 a.m.

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  • April 7, 2017, 2:50 p.m.

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The Cost Reduction Incentive Program at the Savannah River Site. Audit report, report, May 1, 1998; United States. (digital.library.unt.edu/ark:/67531/metadc698554/: accessed October 19, 2017), University of North Texas Libraries, Digital Library, digital.library.unt.edu; crediting UNT Libraries Government Documents Department.